Beware of SARS Auto Assessments
We refer to our recent email to you on 22 June 2022 – The Start of 2022 Tax Season – What you need to know to save you time and costs!!
As discussed, SARS will again be issuing ‘estimated’ assessments automatically to some taxpayers without the submission of a tax return.
From July 2022, SARS will automatically assess a number of taxpayers – if you have been selected for auto-assessment, SARS will send you an SMS.
These Auto Assessments will be based on data received from employers and third-party data providers (e.g. medical schemes and financial institutions) – this is an estimated assessment with specific and complex rules
You may either accept the assessment (if accepted you do not have to submit a tax return at all) OR you are able to make changes to your tax return within 40 business days from the date that your assessment was issued to you.
Taxpayers would need to scrutinise their tax returns to ensure that the correct information is reflected – especially that certain tax deductions are not missed as you could be paying too much tax:
- Donations to qualifying Public Benefit Organisations (Section 18A certificates required)
- Travel allowance claim with substantiating logbook
- Medical expenses not covered by the medical aid/extra medical expenses never submitted to the medical aid
- Other qualifying tax deductions (eg home office expenses or expenses relating to commission income earned)
SARS would also not have any data relating to possible Trust distributions and Capital Gains Tax for the 2022 tax year.
Any deductions not reflected on the automated assessment and corrected within the 40-business day period will be lost.
Should SARS identify any omitted income (not previously disclosed to them), this may result in additional assessment, and SARS will charge an understatement penalty for accepting the incorrect SARS auto assessment!
NB! It is important that the auto-assessment is reviewed before accepting it as the onus is on you as the taxpayer to ensure that this assessment is 100% accurate. And you do not want to pay too much tax.
Please advise me or anyone in our Tax Department should you receive any
communication from SARS directly. We will assist you with this new process to
ensure that your 2022 affairs have been correctly assessed!